TEXT-Fitch places VB-Verbund’s viability rtng on RWN

The rating actions follow the announcement on 13 October 2011 that OeVAG will report a significant loss for FY2011 primarily as a result of write-downs of the book values of its subsidiaries Investkredit Bank AG and Volksbank Romania S.A. At the same time, OeVAG has stated that it will not repay the first tranche (EUR300m) of the government participation capital received in 2009 and that it will postpone the planned demerger of the banking business of OeVAG to Investkredit until further notice.In addition, and as part of its capital strengthening measures in preparation for Basel III implementation, VB-Verbund and OeVAG announced that they have decided to reorganise the structure of the group similar to Rabobank Group’s (‘AA+’/RWN), a development which Fitch views positively as it is likely to strengthen corporate governance, risk management control and consolidated supervision.The RWN on VB-Verbund’s VR predominately reflects Fitch’s view that VB-Verbund’s central institution, OeVAG, continues to face material challenges in relation to its capital position, risk profile and business model, despite considerable deleveraging efforts since 2008. As Fitch does not assign a Viability Rating to OeVAG, the rating action is taken at VB-Verbund level.In its latest rating action commentary dated 19 July 2011, Fitch stated that should OeVAG’s core capital not be strengthened as a result of the capital strengthening measures, VB-Verbund’s VR would come under pressure. OeVAG represents a considerable proportion of VB-Verbund and for FY2011, net profit generated by the steadily performing VB-Verbund’s primary banks will likely not be sufficient to offset OeVAG’s expected sizeable loss (around EUR500m under IFRS on a consolidated level as publicly stated by management).With the exception of the VBI sale, which is likely to increase the regulatory core Tier 1 capital ratio at end-2011, capital raising measures announced earlier this year are being postponed, which is of concern as capital raising measures are being delayed at a time when European banks are faced with increasing capital requirements.Fitch expects to resolve the RWN in the near term once it has assessed the impact of the planned measures on the group’s capital position, financial strength and business model. Depending on the outcome of Fitch’s assessment, VB-Verbund’s VR could be downgraded by more than one notch.VB-Verbund’s and OeVAG’s IDRs are solely based on the agency’s view of sovereign support by the Republic of Austria (‘AAA’/Stable). In Fitch’s view, VB-Verbund’s sizeable domestic market share should improve as the result of the announced reorganisation and will therefore continue to be systemically important for the Austrian economy. However, should the Austrian government’s propensity to support the bank weaken or become constrained by legislative changes, then this would result in a downgrade of VB-Verbund’s and OeVAG’s IDRs.VB-Verbund, which is not a legal entity itself but a cooperative grouping of member banks, is Austria’s fourth-largest banking group. OeVAG is the central institution of VB-Verbund, Austria’s second-largest cooperative banking group. As such, Fitch has assigned OeVAG “group” ratings under Fitch’s rating criteria for banking structures backed by mutual support mechanisms. Fitch does not assign OeVAG a Viability Rating.

@7 months ago with 14 notes
#TEXTFitch #places #VBVerbunds #viability #rtng #on #RWN 

Centrica plans UK biomass power station

* Existing gas plant to shut around 2015LONDON, Oct 12 (Reuters) - British utility Centrica plans to start an 80-megawatt (MW) biomass power plant by around 2016 on the site of a gas-fired power station in Cumbria, which will shut down at roughly the same time, a spokesman said on Wednesday.”It will predominantly burn wood fibres such as pellets and chips which we’ll source it in the UK where possible,” he said.Construction on the project could start in 2013 and will last around 36 months.The utility plans to submit a formal planning application to the Infrastructure Planning Commission (IPC) in summer 2012, the spokesman said.Building work will also include loading and handling facilities at the nearby Barrow Docks to unload imported biomass substance from ships, information submitted to the IPC in a pre-application document showed.The existing 230-MW Roosecote gas-fired power plant has been in operation for around 20 years and will close in the middle of this decade, Centrica said.In January, the utility withdrew an application for a new gas-fired power plant in Brigg, North Lincolnshire, saying it was studying other options for the site, including extending the lifetime of the current 260-MW gas plant.The spokesman said the plans had not progressed since then and all options are still being considered.

@7 months ago with 20 notes
#Centrica #plans #UK #biomass #power #station 

UPDATE 2-Gov’t running out of time to halt Air Canada strike

* Parliament on week-long break, takes time to recallTORONTO, Oct 11 (Reuters) - Canada is running out of time to prevent a strike that could disrupt Air Canada operations, with Parliament on a week-long break and a Thursday strike deadline looming.Canada’s Conservative government has twice drafted back-to-work legislation to halt strikes at Air Canada, the country’s largest airline, although union and management agreed deals before either set of legislation passed.Even if Parliament returns ahead of schedule, parliamentary experts say it would almost certainly take until Saturday, or perhaps even Monday, for legislation to pass.”I am not optimistic this time. I think we are going to see some action,” said Robert Kokonis, president and managing director of AirTrav Inc, an independent airline consulting company.Air Canada’s 6,800 flight attendants rejected a tentative labor contract reached between the airline and their union, the Canadian Union of Public Employees (CUPE), and the union gave notice that it intends to strike on Thursday.The government says a strike would be unacceptable, given the country’s “fragile economy.”But Parliament is closed for the week, and deputies usually receive 48 hours notice of an early recall. The strike deadline is already less than 48 hours away.The flight attendants are willing to resume talks, a source close to the bargaining process said on Tuesday.”We are open to further discussion and are waiting to receive an offer. So far we have not received any indication that they will provide us with an offer before the strike deadline,” the source said.Air Canada has made clear that it’s wary of further talks, given that union members have twice rejected contracts that the union itself recommended.”We have to question the legitimacy of the union’s representation and the entire collective bargaining process. CUPE leadership have failed to secure ratification of two separate tentative agreements,” a spokeswoman said on Monday.A work stoppage by flight attendants would virtually ground the airline, analysts have said. Last month Labor Minister Lisa Raitt said a strike could strand as many as 65,000 passengers on its first day.Flight attendants at Chorus Aviation’s Jazz, which operates short-haul Air Canada Express-branded flights under contract, belong to a separate union.The airline has said that in the event of a strike, it will operate on a partial schedule, using Air Canada Express and regional partner airlines.Air Canada’s main domestic competitor, WestJet Airlines Ltd, will add extra flights in the event of a strike, it said in a release on Tuesday.Kokonis said WestJet and closely-held Porter Airlines will get “longer-term traction” from this strike threat, as passengers opt for more predictable airlines.Shares of Air Canada were down 1.4 percent at C$1.39 on Tuesday morning on the Toronto Stock Exchange.

@7 months ago with 10 notes
#UPDATE #2Govt #running #out #of #time #to #halt #Air #Canada #strike 

China shares end down 2.3 pct on worries over economy

The Shanghai Composite Index closed at 2383.5 points, after a 0.4 percent rise on Monday.Turnover rose on Tuesday, boosted by heavy trading in Chinese dam builder Sinohydro Group , which closed up 17 percent on its market debt after rising nearly 40 percent earlier in the day.

@7 months ago
#China #shares #end #down #23 #pct #on #worries #over #economy 

U.S. open to Afghan peace deal including Haqqani

“Where we are right now is that we view the Haqqanis and other of their ilk as, you know, being adversaries and being very dangerous to Americans, Afghans and coalition members inside Afghanistan, but we are not shutting the door on trying to determine whether there is some path forward,” Clinton said when asked whether she believed members of the Haqqani network might reconcile with the Afghan government.”It’s too soon to tell whether any of these groups or any individuals within them are serious,” she said in an interview with Reuters.Inclusion of the Haqqani network in a hoped-for peace deal — now a chief objective in the Obama administration’s Afghanistan policy after a decade of war — is a controversial idea in Washington.Officials blame the group for last month’s attack on the U.S. embassy in Kabul and a truck bombing that injured scores of American soldiers.The State Department is facing heat from Capitol Hill for refraining, at least so far, from officially designating the Haqqani group, which U.S. officials say is based in western Pakistan, as a terrorist organization.The White House has backed away from assertions from Admiral Mike Mullen, who was the top U.S. military officer until he retired last month, that Pakistani intelligence supported the Haqqani network in the September 13 embassy attack.But President Barack Obama and others have put their sometimes-ally Pakistan on notice that it must crack down on militants or risk severing a key relationship.According to media reports, U.S. officials have held meetings with Haqqani network representatives as part of their efforts — which have not yet yielded any visible results — to strike a peace deal, but the State Department declines to discuss details of the reconciliation process.In recent months reconciliation has become a more prominent feature of Obama’s Afghan strategy even as U.S. and NATO soldiers continued to battle the Taliban and Haqqani militants in Afghanistan’s volatile south and east.Earlier this year, Clinton advanced a peace deal as a key plank of regional policy for the first time, saying Washington would support a settlement between the Afghan government and those militant groups that meet certain requirements, including renouncing violence and supporting the Afghan constitution.FIGHTING, TALKINGDespite the conciliatory signals, Clinton said the United States would stick to its military campaign that the White House hopes will make militants more likely to enter serious negotiations.”Now, it is also true that we are still trying to kill and capture or neutralize them (the Haqqani network),” Clinton said. “And they are still trying to, you know, kill as many Americans, Afghans and coalition members as they can.”“In many instances where there is an ongoing conflict, you are fighting and looking to talk,” Clinton said. “And then eventually maybe you are fighting and talking. And then maybe you’ve got a ceasefire. And then maybe you are just talking.”It is unclear how quickly a peace deal could be had, as it remains unclear how military commanders can achieve and defend security improvements as the foreign force in Afghanistan gradually grows smaller.While parts of the Taliban’s southern heartland are safer than they were, Obama will be withdrawing the extra troops he sent to Afghanistan in 2010 just as commanders’ focus turns to the rugged eastern regions where the Haqqani group are believed to operate.Clinton did not directly address the question of designating the Haqqani network as a ‘foreign terrorist organization,’ but suggested the United States would want to keep its options open as it seeks peace in a region known for historic merry-go-round of political and military alliances.”It’s always difficult in this stage of a conflict, as you think through what is the resolution you are seeking and how do you best obtain it, to really know where you’ll be in two months, four months, six months,” Clinton said.”We are going to support the Afghans and they want to continue to see whether there is any way forward or whether you can see some of the groups or their leaders willing to break with others.”

@7 months ago
#US #open #to #Afghan #peace #deal #including #Haqqani